value generation through asset management · 2017. 12. 22. · performance kpi’s, and evaluation;...

Document ID: 6500_143v02

Released: October 2010

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Organisations © Asset Management Council Slide 1

Value Generation through Asset Management

Ernst Krauss, CFAM, MTech, FIICA, FIEAust

AMC / KAM / SFC / AMECFW / JEMPRELL



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OPEX Optimisation

• Business or Stakeholder requirements

• Production needs

• Extraneous activities

• Behaviors and Practices that are accepted as ‘normal’

• Through Equipment selection and later through System optimisation



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Truth about Equipment selection

• During Project, consider future cost and selection of best cost / performance ratio

Truth: ~ 60% of future cost incurred at stage of engineering approval Truth: 95% of future cost is locked in when P.O. is issued Apply:

• Life Cycle costing

• Reliability specifications

• Maintainability assessment

• Continuous Performance analysis



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Factors affecting Culture

• Corporate / Personal / Equipment Integrity – at what cost?

• Are processes and procedures static or adaptively managed?

• Are the right effectiveness measures used and acted upon?

• Clear lines of Communication –

Marshall Teichert Group – USD 13b wasted by Offshore Industry alone due to ineffective Culture



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Line of sight Business Plan, Organisational Objectives

Strategic Plan, Asset Management Objectives

Asset Management System, Strategic plans and support

Asset Portfolio, Asset Management Plans

Performance KPI’s, and evaluation; Analyses, Performance improvement

Compliance with Plans and Targets

Work Management System; IT Infrastructure; AM System Elements

Work planning, prioritisation, deviations,

cost management, Reliability, Availability

Work execution, transactional systems; schedules;

tools, documentation; data



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Typical Cost Reductions

• Less People

• Less Inventory

• Less Overheads

• But we also need to consider:

• Efforts to retain equipment Reliability

• Reliability / effectiveness of Operational Processes

• Processes and procedures influence behaviour



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Other questions in Asset Management

• How can we deliver better systems at lower life cycle cost?

• What future proofing is required?

• What support organisation is required?

• What behaviour do we want to nourish (Culture)

• Is our strategic view robust and focussed on tomorrow’s needs rather then toady?

• What is our core business?



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3 Key requirements of the AM – System Standard

• An Asset Management Policy

• A Strategic Asset Management Plan

• Asset Management Plan (Operational)

• These are underpinned by elements such as an Asset register, a work management system, Cost management, Decision Framework and form the Asset Management Framework



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The Framework

Asset Disposal

Asset Disposal

Stakeholders requirements and Expectations

Business Plans and Strategic Planning

Vision, Purpose, Values,

Success Measures

Company Asset Management Policy

BU Asset Portfolio M/Plan




Asset Class

M/Plan

Asset Class

M/Plan

Asset Class

M/Plan

Asset Class

M/Plan

Strategic Planning, Governance Service Levels, Cost, Risk, Performance

Work Program

Work Program

Work Program

Asset Disposal

Asset Disposal

Enab

lers

an

d C

on

tro

l:

Stru

ctu

re, A

uth

ori

ties

, R

esp

on

sib

iliti

es, L

earn

ing,

Tr

ain

ing,

Rep

ort

ing,

Ass

et

Val

uat

ion

Enab

lers

an

d S

up

po

rt:

Info

rmat

ion

Sy

stem

s, F

inan

ce, H

R,

Wo

rk

Man

agem

ent

(CM

MS)

Sys

tem

s, A

sset

In

form

atio

n, D

ocu

me

nts

, Rec

ord

s,

Tech

nic

al S

tan

dar

ds,

Leg

al, R

egu

lato

ry,

and

Sta

tuto

ry,

Mat

eria

ls, L

ogi

stic

s

20+ year Horizon

BU SAMP

BU SAMP

BU SAMP

BU SAMP

Work Program

5 to 2 year year Horizon / Current year budget

Reporting

Assurance

Improve

Adjust

Optimise

Update

CAPEX / OPEX Planning

CAPEX / OPEX Submissions (JV’s);

Regulators, and Finance

Corporate

Directive

AMP

Board

POLICY

Strategic

Asset

Management

Plan (SAMP)



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The Framework creates…

• Common Understanding and Purpose across the Asset Organisation

• Aligns functions through the common AM Objectives for the BU (derived from Policy)

• A simpler structure, loss of silo mentality

• Aligns enabling and supporting functions

• Sustainable value that is transparent, with clarity of individual contribution

• An outcome focus that delivers effectively



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AM evolution

Advanced state of

maturity -

Embedded

improvement,

adaptive

behaviour

Intermediate

state of maturity

Behviour

changes

Early state of

maturity

Asset Base data about Assets

(We know what we have)

Data We collect data: cost, historic

performance, failure data, age data

Systems Power of Integration: CMMS, GIS,

Finance etc.

Information Data transformation, structured into

information for higher level use

Analysis FMECA, RCM, Service delivery risk, LCC,

Procurement, Contracts

Models Reliability / Availability Models, Financial,

Planning, CAPEX phasing

Informed Decisions Prioritisation across full

programs of work

Optioneering Trade off, CAPEX / OPEX, risk,

cost, performance balance

Justify Your Investments Board, Stakeholder

confidence



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Select Behavioural Aspects

• Leadership encourages and supports a learning organisation

• Leadership creates the Culture that is needed to foster cooperation (align the required Business functions)

• Clear lines of communications top – down – top creates immediacy

• Clarity of role and purpose increases engagement of workforce



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The Asset Management System in the Business

Stakeholders

Leadership

Organsiational Objectives

Asset Management Objectives

Processes

and Enablers

Roles and

Responsibilities

Decision Processes

Risk Management

Capability

& Culture

Performance Monitoring / Improvement

Enable production delivery to

Business / Stakeholder needs

Asset Management

System

Asset Management

Plans

Data collection and

reporting

Operational Budgets

Sustaining Capital

Renewal / Disposal

Service and Assurance

Strategic Asset Management

Framework, Vision, Direction, Culture

Production requirements and

Objectives



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AM System Standard provides guidance

• We strive for simplicity to be more effective

• AM links inextricably the contributing elements that make up Asset Management:

Economic and Business related

Financial and Accounting

Social and Interactive

Technical

IT and Data Management

…and creates opportunity for sustainable optimisation of the whole business



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THANK YOU FOR YOUR ATTENTION AND INTEREST

Email: [email protected]

[email protected]

mailto:[email protected]

value generation through asset management · 2017. 12. 22. · performance kpi’s, and evaluation;...

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